Revenue Downgrade: Here's What Analysts Forecast For Smart Eye AB (publ) (STO:SEYE)

One thing we could say about the analysts on Smart Eye AB (publ) (STO:SEYE) - they aren't optimistic, having just made a major negative revision to their near-term (statutory) forecasts for the organization. There was a fairly draconian cut to their revenue estimates, perhaps an implicit admission that previous forecasts were much too optimistic.

Following the downgrade, the latest consensus from Smart Eye's dual analysts is for revenues of kr325m in 2023, which would reflect a major 48% improvement in sales compared to the last 12 months. Prior to the latest estimates, the analysts were forecasting revenues of kr374m in 2023. The consensus view seems to have become more pessimistic on Smart Eye, noting the measurable cut to revenue estimates in this update.

View our latest analysis for Smart Eye

The consensus price target fell 9.5% to kr152, with the analysts clearly less optimistic about Smart Eye's valuation following this update.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. The analysts are definitely expecting Smart Eye's growth to accelerate, with the forecast 48% annualised growth to the end of 2023 ranking favourably alongside historical growth of 26% per annum over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 6.8% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Smart Eye to grow faster than the wider industry.

The Bottom Line

The clear low-light was that analysts slashing their revenue forecasts for Smart Eye this year. Analysts also expect revenues to grow faster than the wider market. The consensus price target fell measurably, with analysts seemingly not reassured by recent business developments, leading to a lower estimate of Smart Eye's future valuation. Given the stark change in sentiment, we'd understand if investors became more cautious on Smart Eye after today.

There might be good reason for analyst bearishness towards Smart Eye, like major dilution from new stock issuance in the past year. For more information, you can click here to discover this and the 3 other concerns we've identified.

Another way to search for interesting companies that could be reaching an inflection point is to track whether management are buying or selling, with our free list of growing companies that insiders are buying.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.